Last year PROGRESS in Lending Association named Mortgage Cadence a top innovation. The Mortgage Cadence Configuration Migration Utility (CMU) is an advanced configuration promotion tool only available through the Enterprise Lending Center. This new, patent-pending utility enables the easy migration of ACE Actions, business rules, and formulas from one environment to the next – whether development, staging, or production. The utility also dynamically discovers differences between environments, then surgically migrates the specific configuration changes to the desired environment. With the need to fluidly adapt to constant regulatory and investor requirements, the CMU allows lenders to effectively manage complex configurations efficiently and reliably. We followed up with Sarah Volling, the Marketing Lead at Mortgage Cadence, to talk about her background and what’s new at Mortgage Cadence. Here’s what she said:
Q: You got your start in the mortgage industry in 2008 – the heart of the financial crisis. With little context on what the industry looked like prior, how has the last near-decade transition looked from your perspective?
SARAH VOLLING: Not only have I had the pleasure of seeing the industry bounce back since I started out nine years ago, but I learned at an early age the benefits of home ownership, buying my first home two years into my entrance in the mortgage industry and finalizing the purchase of my fourth home just this week. While working in the industry has taught me a lot and exposed me to its ins and outs, no other experience has shed light on the industry’s progress than being on the receiving end of a mortgage transaction. One thing is clear: The industry is not as far along as we might think.
My first home buying experience back in 2010 was, by far, the easiest mortgage origination transaction I’ve experienced to date. In theory, there should have been a lot working against this. I was a 22 year old recent college graduate and a first-time homebuyer, buying a house in the aftermath of the financial crisis. The key differentiators between that purchase and all of those that have followed can really be boiled down to three things: less regulatory requirements, great communication, and superior technology for the time.
Q: Can you expand on the role you believe regulations, technology, and communication play in today’s origination lifecycle?
SARAH VOLLING: At the time of my first mortgage, I did a lot of online research before beginning the process, using lender’s websites to educate myself. This, in fact, is how I found the lender I ended up going with. This, in essence, was the best technology of the time. Lenders turning to borrower self-origination and education were not nearly as advanced as those today. In fact, even though technology was improving, I recall many instances where I was out of state and had to track down a printer and scanner to print, sign, and return documents to the lender. Today, many of those items simply require digital signatures. While this certainly has made life easier, many things have been made harder. My first mortgage was quick, smooth, and straightforward – all thanks to active communication from the lender, less regulations required by the lender, and the best technology available at the time.
More recently, I’ve had very different experiences. My last two homes were purchased through the same large midmarket lender. The second time around we chose simply for convenience and less about our prior experience, which was average at best. With our current loan being through them, we figured much of the process of buying a new home would be streamlined. We were wrong. We had to provide all of the information – from our names down to our 2015 W2 – that was supplied two years ago during our last origination. We chalked that up to internal compliance checks.
Then, it got worse. Everything from the inspection resolution to the appraisal was in, and we were three weeks away from the closing date. Easy enough to push the closing up, right? Not if your lender needs to put the Closing Disclosure in the mail, forcing you to wait six business days for a document that only requires a three day turn if provided electronically. It got me thinking – how much money is lost each year due to this slowdown in the origination lifecycle? We all know the cost-to-close is higher than it has been in quite some time, and it’s no wonder. While regulations certainly have made things harder, imagine how much could be saved by simply having the means to provide documents electronically.
Also – the lack of communication could have been solved quite easily. Let us know when you receive documents, give us a heads-up about what remains, and work with us to make sure we are comfortable every step of the way. While I’m no stranger to the origination process, the mystery about where in the process our loan stood at any given time was enough to cause doubt in anyone’s mind. To me, it makes me question the lender’s abilities. They might be extremely capable and efficient, but if they don’t let me know what is going on, I come to my own conclusions. I can only imagine how much worse this must be for those new to, or less familiar with, the origination process. Even if we didn’t have active communication from our loan officer, something as simple as an online site to check loan status, upload documents, and see outstanding underwriting conditions would have gone a long way toward improving the situation.
Q: As a member of the Millennial generation, your perspective on the mortgage process is unique. Do you believe this generation is more demanding than Gen X and Baby Boomers?
SARAH VOLLING: It’s funny. Millennials have often been tied to the digital mortgage revolution of the past decade. They’ve been portrayed as this ominous, “Are You Ready?” generation set to shake up the industry forever. While it’s certainly true the idea of the digital mortgage is important, I would argue it is equally important across all generations. As a society, we are all equally accustomed to smartphones and companies designed to make our lives easier through continuous, real-time service. In fact, we recently completed a study of over 1500 US borrowers who had just been through the mortgage origination process and found that Millennials are not only the most likely generation to meet with their loan officer in-person during their home purchase, but are the ones that want to meet with their loan officer face-to-face. To some, this may come as a surprise, but to me, as a member of the Millennial generation, the reason is simple: We want to know the source. You may be familiar with a scene from a sketch comedy show that takes place in the Northwest, where the guest at a restaurant asks the waitress about the chicken. Not about how it’s prepared, but how big the area where the chicken roamed was and what the chicken’s name was. This is perhaps a little extreme, but it makes a great point: Millennials prefer to support businesses they trust, as they want to know where their money is going. Along those same lines, they want to look their loan officer in the eye and have a real conversation about such a major financial decision. Gen X and Baby Boomers not only care less about the back story, but they are also more likely to be familiar with the home buying process already, so they are just as happy to interact digitally with their loan officer and would prefer to do so.
Q: This study sounds quite interesting. What other key findings did you learn from your study?
SARAH VOLLING: Aside from the stereotype-shattering idea that Millennials are the only generation driving the digital mortgage revolution, the most important finding is that 3 in 5 borrowers would be more than happy to provide their private information – including login credentials – in order to streamline the origination process through data aggregation. Allowing borrowers to self-originate was the first step, but the majority of the industry has made that leap. Now, it’s time to think bigger, driving technology advancements that make borrowers’ lives even easier.
In fact, this is a good thing. It’s not a good feeling having to put your deadlines in someone else’s hands, anxiously waiting for a borrower to get you requested documents. Through data aggregation tools, you can take back control of the process, gaining just one more way to accelerate the origination process in the midst of an ever-increasing cost to close.
Q: As a marketer, you sit uniquely between business-to-business (B2B) and business-to-consumer (B2C) marketing worlds. What trends are you seeing that transcend all industries?
SARAH VOLLING: No surprise here: All-things-digital. To expand upon what that means, attention spans are getting shorter. The amount of time you have to get noticed with consumers is next to nothing. While videos are certainly a stronger route than traditional text-heavy websites and sales materials, I would suggest going even shorter with GIFs. These looped video clips are often 2 seconds to 10 seconds long, with content that does not need sound. I saw a great use of this on Facebook as a sponsored post for a local food chain. The ability to get in front of a wide audience through social media using a video clip that automatically plays as consumers scroll past it on their phones offers distinct benefits that traditional videos simply can’t compete with.
As it relates specifically to the mortgage industry, I would suggest keeping your efforts as honest as you can. As I previously mentioned, Millennials are interested in full transparency. To capture this audience’s attention, they want to know what you stand for and that your best interests are with your customers.
Q: With the political landscape causing great uncertainty for our industry, what is top of mind for Mortgage Cadence heading into 2017?
SARAH VOLLING: It’s hard to predict the direction – specifically related to the regulatory landscape – in which we will be heading in the next several years. What can be predicted — and what lenders should focus on for the time being — are technology advancements to support the consumer experience and provide the full transparency the next largest generation of their customers expect.
The trends I’ve already mentioned lead to some very strategic initiatives for Mortgage Cadence. We were fortunate enough to use the borrower study we recently completed to provide some real-world evidence regarding the top priorities tomorrow’s borrowers have about the origination process. This is driving many initiatives related to consumer-facing technologies. We expect to have three major technology announcements in the next few months that will really give lenders the tools needed to succeed no matter what the regulatory landscape shapes up to be in the years ahead.
Q: Your highly regarded annual user conference is just a short time away. Can you provide a sneak peek of the themes you are planning for this year’s conference?
SARAH VOLLING: Our annual user conference, Ascent, is by far the most anticipated event we put on each year. We spend easily nine months planning the agenda, lining up influential speakers, and structuring networking opportunities with the goal of topping the previous year’s events. This year is no exception.
This year, we decided to break our agenda up into tracks designed to give our customer base sessions relevant to their interaction with our technology. Not only do we offer two leading loan origination solutions, but we draw various system users – from business operations to IT power users – to our conference, and we want everyone to have content to meet their needs.
In addition, we’re excited to bring back our 2017 Benchmark Study, which will build on data collected since 2012 on key performance indicators (KPI) of our customers’ businesses. Comparing their KPIs to those of the industry at large not only gives our customers insight into how they compare to industry averages, but gives us insight into where inefficiencies lie within today’s origination processes, helping guide their future operational strategies. Ultimately, we strive to be a partner for a customers and not just a technology provider. Our user conference is one of our best opportunities for us to continue our commitment to partnership.
Sarah Volling is the Marketing Lead for Mortgage Cadence, an Accenture Company. Beginning her career with the company in 2008, Sarah now oversees the marketing department, strengthening brand identity through thought leadership, industry participation and guerilla marketing. Prior to joining Mortgage Cadence, Sarah earned her Bachelor of Arts degree in Communication from the University of Colorado.
Sarah Volling thinks:
1.) While digital lending will continue to be critical to long-term success, the value of face-to-face interactions with borrowers will make a comeback.
2.) The focus of the Digital Mortgage is finally going to shift away from the consumer and more onto how all of the companies that are part of bringing a mortgage together can streamline efforts.
3.) Despite current and future industry changes and regulatory demands, the consumer will always be the biggest driver of change, pushing their expectations of greater transparency and better communication even further onto the lender.